Friday, October 31, 2008
Possibly A New Ball Game
ZOGBY SATURDAY: Republican John McCain has pulled back within the margin of error... McCain outpolled Obama 48% to 47% in Friday, one day, polling. He is beginning to cut into Obama's lead among independents, is now leading among blue collar voters, has strengthened his lead among investors and among men, and is walloping Obama among NASCAR voters. Joe the Plumber may get his license after all...
State employee says she was ordered to check out Joe the Plumber
Change and Hope, Transparency and A New World. Obama Is Who We have been waiting for.
this is getting scary
this is getting scary
Hero: Joseph Gibson
Joseph Gibson
As the helicopter full of Rangers touched down that April night, Gibson and fellow soldiers found themselves dodging enemy small arms fire less than 50 meters away. Gibson’s platoon sergeant would later say the enemy small-arms and machine-gun fire began less than a minute after the group disembarked the helicopter. Among the two Ranger casualties was a soldier with a life-threatening gun shot wound.
Transporting wounded soldier over an uneven field with irrigation ditches and through enemy fire was a challenge, but the Rangers’ dedication to each other motivated Gibson to get his friend to safety.
“It was my buddy; I didn’t want to quit, Gibson said later. “For a while, it was just me on one end of the litter.”
Gibson’s actions are credited with saving the soldier’s life. The soldier returned home safely to see his wife and newborn child.
After assisting in this medical evacuation, Gibson and the Rangers continued on with their mission. They began to clear a field with tall grass and canals near the helicopter landing zone. The Rangers knew enemy fighters were still in the area, even though most had fled when the soldiers touched down. While clearing the field, Gibson stepped on a terrorist hiding in a ditch under some grass. Initially, Gibson continued for a few more steps past the terrorist. But following his gut instinct, Gibson turned around to investigate what he’d stepped on. The terrorist moved to kill Gibson and the Rangers. Gibson grabbed the muzzle of the terrorist’s rifle as the terrorist began to fire. Gibson wrestled the terrorist to the ground and gained positional control. He struggled and later stripped the terrorist of his weapon. The terrorist then gripped Gibson’s rifle. Without the ability to use a firearm, Gibson engaged the enemy with his hands. The terrorist ripped off Gibson’s helmet and all his night vision optics, then began to reach for something hidden in his clothing -- the detonator to his suicide vest. The terrorist screamed “Bomb!” in English.
As Gibson worked to stop the terrorist from detonating his vest, the terrorist had maneuvered into a position that was cutting off Gibson’s circulation. Gibson, in an effort to save himself, began to hit the terrorist as hard as he could. His blows rendered the terrorist unconscious.
“I got my weapon into his stomach and fired,” Gibson said. “He came back to consciousness after that, [but] I knew I got him. I stood up and neutralized him.”
“Rangers are proven over and over again in battle,” Navy Adm. Eric Olson, commander of the U.S. Special Operations Command, said in presenting Gibson with his Silver Star Medal. “Rangers are glorified in Hollywood movies, but you aren’t actors. You are real men who make real sacrifices.”
Gibson said he is honored to serve as a Ranger and have saved his fellow soldier’s life. Following the incident, Gibson re-enlisted to fight with the Ranger platoon he accompanied that night.
$120k & Your Rich! - Gov. Bill Richardson
Good thing the election is next week or $15k is in their sites.
Thursday, October 30, 2008
The Barack Obama Lack-Of-Variety Show- Mark Steyn
This is an amazing race. The incumbent president has approval ratings somewhere between Robert Mugabe and the ebola virus. The economy is supposedly on the brink of global Armageddon. McCain has only $80 million to spend, while Obama's burning through $600 mil as fast as he can, and he doesn't really need to spend a dime given the wall-to-wall media adoration. And tonight Chris Matthews' doctors announced that his leg tingle has metastasized leaving his entire body like a vibrating cellphone whose ringtone is locked on "I'm In Love, I'm In Love, I'm In Love, I'm In Love, I'm In Love With A Wonderful Guy."
08 reasons Barack Obama will win next Tuesday
hmmmm I'd rather think of a few reasons he will lose:
1) Who is this guy? the cool calm collected guy we see or the guy that has nothing but radical associations.
2) he is for the middle class. but when Joe the plumber asks a question, the next day he laughs at him in disdain. Maybe Joe is "one of "those" bitter people that cling to their guns and their God."
3)he is giving a tax cut to everybody under $250k, no wait that's $200k, no Biden now says $150k...didn't Clinton promise the same thing and then pass the biggest tax increase in history?
4)He is for change and transparency, but when you disagree with him or ask a solid question you are cut off or investigated and trashed by the media and his campaign
5) his wife creeps me out with that "America is a mean country"
6) he creeps me out with that "rightous wind" and "we are the one we have been waiting for"
7)is there something he has done on his own other then blow all that grant money with Ayers? or voted present on every major bill there was?
8)it just seems like we don't know this guy at all. and if i don't vote for him, i'm stupid, angry, or racist.
1) Who is this guy? the cool calm collected guy we see or the guy that has nothing but radical associations.
2) he is for the middle class. but when Joe the plumber asks a question, the next day he laughs at him in disdain. Maybe Joe is "one of "those" bitter people that cling to their guns and their God."
3)he is giving a tax cut to everybody under $250k, no wait that's $200k, no Biden now says $150k...didn't Clinton promise the same thing and then pass the biggest tax increase in history?
4)He is for change and transparency, but when you disagree with him or ask a solid question you are cut off or investigated and trashed by the media and his campaign
5) his wife creeps me out with that "America is a mean country"
6) he creeps me out with that "rightous wind" and "we are the one we have been waiting for"
7)is there something he has done on his own other then blow all that grant money with Ayers? or voted present on every major bill there was?
8)it just seems like we don't know this guy at all. and if i don't vote for him, i'm stupid, angry, or racist.
McCain Trusted More on Taxes and Economy
After several weeks of John McCain’s campaign attacks on Barack Obama’s tax plan and idea of “spreading the wealth around”, the latest Rasmussen Reports national telephone survey finds voters trust McCain more than Obama on taxes, 47% to 45%.
Wednesday, October 29, 2008
Obama's Economic Mythology
But...But the recession, we are in the worst times since the great depression or is it the great deception?
Barney Frank Is Gay?
Gee I thought when he had that young man running a homosexual brothel out of Barney's house or when he had a roomie for 7 years that just happened to work at Fannie or Freddie or Spanky or whatever that it was all just a a coincidence
Another Hero Home! Welcome Home Jake!!!!!!!!!
How can we ever thank these young hero's who sacrifice so much and sometimes their all so that we can do the things we do?
Hero: Captain Stephen P. Ward
Stephen P. Ward
Sgt. 1st Class Drew C. Kimmey, Capt. Stephen P. Ward and Staff Sgt. Carlo A. Alcazar, members of Civil Affairs Team 745, were recently recognized for their performance during an Afghanistan mission last November. The three soldiers were recognized for their efforts in rescuing a Special Forces team leader, who was also the ground forces commander that day.
CA Team 745 was stationed at Firebase Cobra in Oruzgan, Afghanistan, with special operations detachments from the 3rd Special Forces Group, members of the Afghan National Army and the Afghan National Police. On Nov. 2, 2007, the teams and their Afghan counterparts left the firebase to visit the village of Sarsina to conduct medical capabilities mission as well as a humanitarian aid drop. Once they arrived at the village, they discovered it had been evacuated and that Taliban fighters were entrenched into several fighting positions in an attempt to ambush forces in the area.
Alcazar reported only three families came in for medical treatment. The families told the soldiers the Taliban made the other people leave the village, but that having nowhere to go. they stayed. “What was alarming,” Ward said later, “was the buildings had locks and barricaded doors, which was a clear indication that the village wasn’t abandoned, but had been turned into a defendable position.”
All three quickly figured it was only a matter of time before the firefight would begin.
The teams were quickly engaged by 300 Taliban fighters. According to Army documents, after an hour of fighting, two vehicles were pulled to the rear of the fight after being disabled. This left the ground forces commander to the front of the coalition lines and in jeopardy of being overrun. At this point, Ward, the team leader for 745, radioed to the ground forces commander, who was pinned down in a vulnerable building, that his was on its way. Ward later said he and Alcazar went because they were the closest truck and the others were busy providing cover. Unfortunately, the team’s vehicle crashed into an enemy fighting position and became immobile, knocking Ward and Alcazar momentarily unconscious.
After they regained consciousness, Alcazar took to reloading ammunition belts, enabling Kimmey, the gunner, to continue to engage enemy forces. Ward exited the vehicle and directed his team to dismount and move to cover. Kimmey remained in the turret, providing cover for the team and allowing them to reach the ground forces commander. He stayed even though he knew the enemy was setting up mortar positions to destroy the truck he was firing from.
Kimmey was able to keep the Taliban from overrunning the soldiers with the .50-caliber gun. In the process, he was drawing a majority of the enemy fire. Ward reported the enemy was about 50 to 100 meters away at this point.
Team 745 moved to the ground commander’s position and helped in the recovery of the commander and the casualties. All of this was done, while under “continual, accurate and effective” enemy fire.
Since the team’s 745’s vehicle was immobile, it was stripped of all sensitive equipment, and its gun was dismantled to prevent the enemy from gaining off of the team’s loss. Once team 745 sterilized their truck, they had no choice but to run beside the Special Forces vehicle, using it as cover, until they reached safety, because there was no room for them on the truck. All three of them ran alongside the truck until they reached a checkpoint and mounted up into another vehicle for the ride back to firebase Cobra.
During the civil affairs award ceremony honoring all three for their heroic acts, Maj. Gen. John F. Mulholland, said, “The words can’t do justice, nor can the medal on your chest convey what they went up against.”
Tuesday, October 28, 2008
Obama Affinity to Marxists Dates Back to College Days
Just like you and I except he likes Marxists, radicals, and the occassional terrorist
Der Spiegel Interviews Robert Kagan
'America Remains Number One'
In an interview with SPIEGEL, American neoconservative scholar and McCain adviser Robert Kagan speaks about the legacy of the Bush-Cheney years, America's future position atop a "League of Democracies" and how China and Russia will push Europe back into America's arms.
In an interview with SPIEGEL, American neoconservative scholar and McCain adviser Robert Kagan speaks about the legacy of the Bush-Cheney years, America's future position atop a "League of Democracies" and how China and Russia will push Europe back into America's arms.
Investors Flee From 'Change' Obama Hypes
Are Barack Obama's proposed tax increases adversely affecting our financial markets? We say yes, unambiguously. The senator has done a masterful job distracting attention from his tax increases with his $500-per-worker tax credit supposedly for 95% of Americans.
Bedside Manner: Advocating for a Relative in the Hospital
Some hospitals now have nurses give change-of-shift reports at the bedside and encourage families to share observations.
Monday, October 27, 2008
Hero: Sergeant Fist Class Drew Kimmey
Sgt. 1st Class Drew C. Kimmey, Capt. Stephen P. Ward and Staff Sgt. Carlo A. Alcazar, members of Civil Affairs Team 745, were recently recognized for their performance during an Afghanistan mission last November. The three soldiers were recognized for their efforts in rescuing a Special Forces team leader, who was also the ground forces commander that day.
CA Team 745 was stationed at Firebase Cobra in Oruzgan, Afghanistan, with special operations detachments from the 3rd Special Forces Group, members of the Afghan National Army and the Afghan National Police. On Nov. 2, 2007, the teams and their Afghan counterparts left the firebase to visit the village of Sarsina to conduct medical capabilities mission as well as a humanitarian aid drop. Once they arrived at the village, they discovered it had been evacuated and that Taliban fighters were entrenched into several fighting positions in an attempt to ambush forces in the area.
Alcazar reported only three families came in for medical treatment. The families told the soldiers the Taliban made the other people leave the village, but that having nowhere to go. they stayed. “What was alarming,” Ward said later, “was the buildings had locks and barricaded doors, which was a clear indication that the village wasn’t abandoned, but had been turned into a defendable position.”
All three quickly figured it was only a matter of time before the firefight would begin.
The teams were quickly engaged by 300 Taliban fighters. According to Army documents, after an hour of fighting, two vehicles were pulled to the rear of the fight after being disabled. This left the ground forces commander to the front of the coalition lines and in jeopardy of being overrun. At this point, Ward, the team leader for 745, radioed to the ground forces commander, who was pinned down in a vulnerable building, that his was on its way. Ward later said he and Alcazar went because they were the closest truck and the others were busy providing cover. Unfortunately, the team’s vehicle crashed into an enemy fighting position and became immobile, knocking Ward and Alcazar momentarily unconscious.
After they regained consciousness, Alcazar took to reloading ammunition belts, enabling Kimmey, the gunner, to continue to engage enemy forces. Ward exited the vehicle and directed his team to dismount and move to cover. Kimmey remained in the turret, providing cover for the team and allowing them to reach the ground forces commander. He stayed even though he knew the enemy was setting up mortar positions to destroy the truck he was firing from.
Kimmey was able to keep the Taliban from overrunning the soldiers with the .50-caliber gun. In the process, he was drawing a majority of the enemy fire. Ward reported the enemy was about 50 to 100 meters away at this point.
Team 745 moved to the ground commander’s position and helped in the recovery of the commander and the casualties. All of this was done, while under “continual, accurate and effective” enemy fire.
Since the team’s 745’s vehicle was immobile, it was stripped of all sensitive equipment, and its gun was dismantled to prevent the enemy from gaining off of the team’s loss. Once team 745 sterilized their truck, they had no choice but to run beside the Special Forces vehicle, using it as cover, until they reached safety, because there was no room for them on the truck. All three of them ran alongside the truck until they reached a checkpoint and mounted up into another vehicle for the ride back to firebase Cobra.
During the civil affairs award ceremony honoring all three for their heroic acts, Maj. Gen. John F. Mulholland, said, “The words can’t do justice, nor can the medal on your chest convey what they went up against.”
Saturday, October 25, 2008
Washington Is the Problem
FedEx's CEO on McCain, free trade and the tax bias against capital-intensive industries.
Fred knows the deal
Fred knows the deal
"Faith, hope, and charity" are Christ's things
"Faith, hope, and charity" are Christ's things. They apply, properly, outside time -- to a "futurity" that is not of this world. They must not be applied to any earthly utopia. A Caesar who appropriates otherworldly virtues, is riding upon very dangerous illusions. Follow him into dreamland, and you'll be lucky to wake up.
Sniper (And Hero) Jake Has A Request
Marine Corps Marathon
Many of you who followed this site last year remember my good friend Dave Folwell running in the Marine Corps Marathon and raising money for the Wounded Warriors Foundation. He ran in honor of some mutual friends that we had who were hurt last year, and your generous donations helped him blast past his modest goal of $1,000 all the way to over $5,000.
Well, he's at it again. I wish I could have had more time to stump for him this year, but I just got the email (been a little cut off lately...). If you could please help us out, it would be amazing. Unfortunately it's even more personal this year, as many, many more warriors of 2/7 have been wounded in the past 7 months of fighting against the Taliban.
Link: (forgot this one yesterday...kinda important)
http://www.active.com/donate/TH4WMCM2008/DFolwel
Anything and everything makes a difference. Thank you sincerely.
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A Reality Check on Obama's Wish List - Barone
What will an Obama administration and a Congress with increased Democratic majorities do? That's a relevant question, given the Democrats' leads in the polls. And it's a little hard to answer, given the financial crisis that has been raging and the recession that seems to be ahead.
New promising obesity drug may have huge potential
According to trials, a new obesity drug, Tesofensine, which may be launched on the world market in a few years, can produce weight loss twice that of currently approved obesity drugs. The Danish company Neurosearch and a number of researchers at the Faculty of Life Sciences at University of Copenhagen are behind the promising findings.
Tesofensine can produce weight loss twice that of currently approved obesity drugs, and should be studied in phase III trials. These are the conclusions of an Article published early Online and in an upcoming edition of The Lancet, written by Professor Arne Astrup, Department of Human Nutrition, Faculty of Life Sciences, University of Copenhagen, Denmark, and colleagues.
Increased obesity prevalence worldwide, in both developed and developing countries, results in more people with cardiovascular disease, diabetes, musculoskeletal disorders, and cancer. Whilst gastric bypass surgery substantially reduces bodyweight and obesity-related disease, the researchers believe a treatment gap exists between the effectiveness of currently marketed obesity drugs and gastric-bypass surgery. Tesofensine – which inhibits the presynaptic uptake of the neurotransmitters noradrenaline, dopamine and serotonin in the brain – has been shown to be safe and effective in animal models. It also caused unintended weight loss when it was given obese patients with Parkinson's or Alzheimer's disease when it was researched for those conditions. The drug works by suppressing hunger, leading to an energy deficit which burns off excess body fat.
Tesofensine can produce weight loss twice that of currently approved obesity drugs, and should be studied in phase III trials. These are the conclusions of an Article published early Online and in an upcoming edition of The Lancet, written by Professor Arne Astrup, Department of Human Nutrition, Faculty of Life Sciences, University of Copenhagen, Denmark, and colleagues.
Increased obesity prevalence worldwide, in both developed and developing countries, results in more people with cardiovascular disease, diabetes, musculoskeletal disorders, and cancer. Whilst gastric bypass surgery substantially reduces bodyweight and obesity-related disease, the researchers believe a treatment gap exists between the effectiveness of currently marketed obesity drugs and gastric-bypass surgery. Tesofensine – which inhibits the presynaptic uptake of the neurotransmitters noradrenaline, dopamine and serotonin in the brain – has been shown to be safe and effective in animal models. It also caused unintended weight loss when it was given obese patients with Parkinson's or Alzheimer's disease when it was researched for those conditions. The drug works by suppressing hunger, leading to an energy deficit which burns off excess body fat.
From laboratory to the fuel tank
One man’s pond scum is another man’s ticket to energy independence.
Just ask attendees of a conference Friday in The Woodlands that focused on the potential of algae in making renewable fuels.
Just ask attendees of a conference Friday in The Woodlands that focused on the potential of algae in making renewable fuels.
Government computers used to find information on Joe the Plumber
But it's Americans right to know, who cares about goverment and a citizens privacy!!!!
UPDATE: More From Ed Morrissey
UPDATE: More From Ed Morrissey
Friday, October 24, 2008
Jennifer Rubin
Barney Frank and Joe Biden are the sodium pentothal of the Democratic Party. Biden told us to be afraid on national security. Frank tells us they Democrats will be coming after us with a big tax increase. Now Frank tells us that he wants a 25% reduction in defense spending.
So let’s get this straight: we are going to see more than $4 trillion in new spending, have a big tax increase, and defund our military — while certain to face international challenges where “it’s not gonna be apparent that we’re right.” And this is what Democrats are saying?
If the McCain camp were not so busy at the dirty laundry festival, they might make use of all this in one last punchy ad.
So let’s get this straight: we are going to see more than $4 trillion in new spending, have a big tax increase, and defund our military — while certain to face international challenges where “it’s not gonna be apparent that we’re right.” And this is what Democrats are saying?
If the McCain camp were not so busy at the dirty laundry festival, they might make use of all this in one last punchy ad.
Wounded Warrior Project
Home Front captures the human story of what happens when seriously injured Army Ranger Jeremy Feldbush returns to civilian life in his small hometown, as he readjusts to friends, family, community- and most importantly, his new, altered self. The film also focuses on Jeremy's family, and how they cope with events that have forever changed them.
In the past few weeks, we've seen our Presidential hopefuls come toe to toe and discuss the many different issues currently facing us as a nation.
So when not one word was spoken during the recent Presidential debates on behalf of those who have bravely served our country and come home as wounded warriors, the Wounded Warrior Project felt it necessary to highlight the service of our brave men and women.We're asking everyone to honor Veterans Day this year by watching "Home Front," the unforgettable film by Richard Hankin. "Home Front" captures the human story of what happens when seriously injured Army Ranger Jeremy Feldbusch returns to life in his small hometown, as he readjusts to friends, family, community, and - most importantly - his new, altered self. The film also focuses on Jeremy's family and how they cope with events forever changing them.
Please take a few moments and view this "Home Front" video clip and see why we cannot forget the sacrifices of our brave men and women who have served this country so courageously.How to get involved and show you care:Buy two DVDs to give one to someone you care about and share its inspiring message.Make a tax-deductible donation to the Wounded Warrior Project. Support WWP’s many programs and services to help meet the needs of our wounded heroes.
So when not one word was spoken during the recent Presidential debates on behalf of those who have bravely served our country and come home as wounded warriors, the Wounded Warrior Project felt it necessary to highlight the service of our brave men and women.We're asking everyone to honor Veterans Day this year by watching "Home Front," the unforgettable film by Richard Hankin. "Home Front" captures the human story of what happens when seriously injured Army Ranger Jeremy Feldbusch returns to life in his small hometown, as he readjusts to friends, family, community, and - most importantly - his new, altered self. The film also focuses on Jeremy's family and how they cope with events forever changing them.
Please take a few moments and view this "Home Front" video clip and see why we cannot forget the sacrifices of our brave men and women who have served this country so courageously.How to get involved and show you care:Buy two DVDs to give one to someone you care about and share its inspiring message.Make a tax-deductible donation to the Wounded Warrior Project. Support WWP’s many programs and services to help meet the needs of our wounded heroes.
How Capitalism Will Save Us- Steve Forbes
We are experiencing the devastating consequences of a chain of major economic policy errors, which, to use a current cliché, created the perfect storm. These government blunders temporarily paralyzed the global credit system and are now sending the U.S. and Europe into recession, while sharply cutting back Asia's growth rates.
Left to its own devices, the credit crisis, which began in August 2007, would have crushed economies as severely as did the Great Depression.
Belatedly, but thankfully, governments recognized that the only way to get credit flowing again was for them to make quick and direct massive infusions of new equity into beleaguered banks, as well as commit to other emergency measures hitherto unimaginable.
If sensible rescue efforts continue--and they will--the immediate crisis will quickly pass. Shell-shocked businesses and consumers won't recover rapidly from the trauma of recent months, especially as we now cope with recession. But the downturn shouldn't be prolonged: The economy here and those overseas should start to pick up no later than next spring.
That soon? Despite the crisis, the global economy still retains enormous strengths. Between the early 1980s and 2007 we lived in an economic Golden Age. Never before have so many people advanced so far economically in so short a period of time as they have during the last 25 years. Until the credit crisis, 70 million people a year were joining the middle class. The U.S. kicked off this long boom with the economic reforms of Ronald Reagan, particularly his enormous income tax cuts. We burst from the economic stagnation of the 1970s into a dynamic, innovative, high-tech-oriented economy. Even in recent years the much-maligned U.S. did well. Between year-end 2002 and year-end 2007 U.S. growth exceeded the entire size of China's economy. Obviously China's growth rates were higher, but China was coming off a much smaller base.
The world is flush with cash. It's frozen because of fear, but the cash is there. Productivity gains are burgeoning.
So, will this global boom resume next year, slowly at first and then with increasing momentum? It should. Whether that happens, however, depends on the next, highly dangerous phase: the political aftermath.
Will we and other countries pursue policies that hinder growth and retard or abort a full-blown recovery, e.g., regulations that stifle innovation and taxes that harm the creation and deployment of capital? Washington politicians are asking: If the federal government can bail out banks, why not other battered businesses? Congress recently voted for $25 billion in loan guarantees aimed at helping Detroit automakers. (This money is to be used not only to aid Detroit but also to prevent another flare-up of the credit crisis. If the Big Three defaulted on their debts, holders of credit default swaps--which in recent years have grown like toxic weeds--would demand payment from those who wrote the insurance on the automakers' bonds. This would create another wave of losses for financial institutions.)
Some liberal political activists are advocating using Washington's new powers to pursue other agendas, such as forcing tighter emissions curbs or mandating costly health insurance coverage. New attempts to restrict corporate pay, at least in some sectors, is a given--overlooking the unintended side effects of Bill Clinton's attempt to limit CEO pay packages back in 1993. (The deductibility of CEOs' salaries was capped, which led companies to use stock options as never before.) Protectionists are renewing calls for trade restrictions in the name of consumer safety and promoting "better" labor and environmental standards. Politically resurgent labor unions and other activists will push for rules on who sits on corporate boards to "better represent consumers and investors." They want an implicit veto power over the policies of publicly held companies. They're also ready to remove barriers, such as the secret ballot, in order to coerce workers into joining unions.
The financial sector will certainly face new rules and regulations. Will these be sensible, such as rationalizing our myriad, overlapping financial regulatory structures and pushing for the creation of exchanges and clearinghouses for exotic instruments, such as credit default swaps, so we have transparency and standardization? Or will they be punitive and costly like the Sarbanes-Oxley Act? Washington's new powers over banks may make our capital markets more hostile to entrepreneurs--savings bonds won't give you high returns, but they will protect you from political fallout. Or, as happened with Fannie Mae and Freddie Mac, will they make banks do things for political not economic reasons?
A chilling result of the crisis will be furthering the deadly process of criminalizing business failures. In the old days when an enterprise failed, the proprietors often ended up in debtors' prison. One of the significant advances of civilization and economic progress was the idea of limited liability, which took hold in the 19th century: Investors would be liable only for the money they actually put into a corporation; their other assets would be safe. If an enterprise failed, they lost only what they had invested. Limited liability thereby set off a positive explosion of risk taking. Our standard of living today would be where it was in the 1850s were it not for the wide use of limited liability.
But in recent years, particularly after the Enron/WorldCom corporate scandals, federal and local prosecutors began actively pursuing evidence of fraud whenever a big business went bust. Yes, there has been corporate wrongdoing, and miscreants have been tried and jailed. But many noncriminal individuals have been pursued.
One notorious case was the IRS' attempt to prosecute KPMG and a number of its partners and employees for alleged tax fraud. The shelters KPMG sold in the 1990s were not illegal. The IRS still determined, however, that they weren't valid. That kind of tax dispute would normally be settled in civil court. Instead, prosecutors threatened KPMG with annihilation: Settle on our terms or we will hit you with an enterprise-killing indictment. Arthur Andersen had recently been destroyed by such an indictment, even though the courts subsequently threw the charges out. The feds even pressured KPMG not to pay the legal bills of the targeted individuals--which would have forced these people to settle, as they couldn't afford the massive legal costs of defending themselves. Thankfully, a courageous federal judge stopped this abuse.
But the itch to indict remains. No sooner had Bear Stearns, Lehman Brothers and AIG gone bust than criminal investigators swarmed in. They will find evidence of "fraud"--why didn't you more aggressively mark down the value of suspect paper even if there wasn't a market for it? Why the expressions of confidence in the soundness of your businesses when the rumors of trouble were surfacing? Lost in all this will be the fact that Lehman and AIG didn't know they were in mortal peril until almost the very end. There will be indictments. The chilling lesson: Unsuccessful risk taking or failing in business can send you to prison.
So what should our responses be now? To answer that, we must first understand the crisis' causes.
What started in August 2007 was not the failure of free markets but the outcome of bad government actions. Greed and recklessness always run rampant during bubbles, and the mania that engulfed housing and much of the financial sector was no exception. The behavior of mortgage bankers and of Wall Street packagers of subprime mortgages, as well as the excesses and misuses of exotic instruments, will be grist for investigators and writers for decades to come. But all this came about because of government errors--regulatory and monetary.
In 2004 the Federal Reserve made a fateful miscalculation. It thought the U.S. economy was much weaker than it was and therefore pumped out excessive liquidity and kept interest rates artificially low. When too much money is printed, the first area to feel it is commodities. Thus the Fed begat a global commodities boom. The price of oil, copper, steel, international shipping--even mud--shot up. The price of gold roared above its average of the previous 12 years. For nearly 4 years the dollar sank against the euro, yen and pound. Domestically the already booming housing market went on steroids. Housing was experiencing above-average price rises because of a favorable change in the tax law in 1998 that virtually eliminated capital gains taxes on the sale of most primary residences. Now with money easy, a bubble mentality took hold. The reasoning was that housing prices always go up; therefore, lending standards could be safely lowered. If a dodgy borrower defaulted, it didn't matter--the value of the house would always be higher. Wall Street's appetite for these fee-generating packages of subprime mortgages became gluttonous. Rating agencies also drank the Kool-Aid and gave AAA ratings to this stuff, which, thanks to securitization, was spread all around the world. The Fed and other bank regulators stood by as the bubble ballooned.
Why didn't the Treasury Department--behind the scenes--tell the Fed to strengthen the enfeebled greenback? Because the Bush Administration likes a weak dollar, feeling that it will improve our trade balance by artificially making our exports cheaper. Not since Jimmy Carter has the U.S. had such a weak-dollar Administration. This mania would never have reached the proportions it did had the Fed and Treasury had a strong-dollar policy.
The housing bubble burst in 2007, and banks and investors began to be fearful--who had this junk, and how much did they hold? The credit system showed the first signs of panic. The Federal Reserve responded with another round of easy money, thus creating yet another commodities bubble. Finally, this summer, the Fed ceased spraying money like a fire hose. Dollars that had been lent out through the Fed's various borrowing facilities were then soaked up in its open-market operations. That's why, when the panic reached a peak this fall, gold prices didn't go through the roof as everyone sought safety. In fact, gold never reached the level it had in July.
Maybe, just maybe, Ben Bernanke has learned a lesson about the need for stable money that his predecessor, Alan Greenspan, never did.
Another factor fanning the housing bubble was Fannie Mae and Freddie Mac. They were smarting from studies (including a couple from the Federal Reserve) concluding that these two "government-sponsored enterprises" had little or no positive impact on helping the housing market. And they were also reeling politically from egregious accounting scandals. The companies, therefore, decided they could justify their existence by becoming champions of "affordable housing." They guaranteed $1 trillion of less-than-prime mortgages and kept more than $100 billion of this suspect paper on their balance sheets. Mortgage banks and Wall Street packagers of securities knew that Fannie and Freddie were there to buy whatever questionable stuff they offered up.
Over the years efforts by a handful of senators and representatives to rein in these two monsters were easily brushed off, as were those of the Fed to have them shrink their mammoth sizes. (Of course, now that the bubble has burst, what was once dubbed as promoting affordable housing is being portrayed as "predatory lending.")
Even with Fannie and Freddie inflating the bubble and the Fed and the rest of the Bush Administration weakening the dollar, the crisis never would have become so unprecedentedly destructive but for a seemingly arcane accounting principle called mark-to-market, or fair value, accounting. The idea seems harmless: Financial institutions should adjust their balance sheets and their capital accounts when the market value of the financial assets they hold goes up or down. That works when you have very liquid securities, such as Treasurys or the common stock of IBM or GE. But when the credit crisis hit there was no market for subprime securities. Yet regulators and lawsuit-fearful auditors pressed banks and other financial firms to relentlessly knock down the book value of this subprime paper, even in cases where these obligations were being serviced in the payment of principal and interest. Mark-to-market became the weapon of mass destruction.
When banks wrote down the value of these assets they had to get new capital. The need for new capital was a signal to ratings agencies that these outfits might be in need of a credit-rating reduction. This forced financial firms to increase collateral for credit default swaps--which meant more calls for new capital.
Result: Investment banks that still had positive cash flows found themselves in a death spiral. Of the $600-plus billion that financial institutions have written off, almost all of it has been book writedowns, not actual cash losses. This accounting madness sank Fannie and Freddie this summer when the government effectively took them over and provided them with a $200 billion loan facility. The two entities are still cash positive and haven't drawn down a dime of this new line of credit.
Rigid mark-to-market accounting is similar to a highway that has a speed limit and a speed minimum. When snow appears on the road, bad road conditions cause drivers to go slowly. Under a mark-to-market concept, police would be ticketing these slow drivers for going below the minimum speed.
If this accounting asininity had been in effect during the banking trouble in the early 1990s, almost every major commercial bank in the U.S. would have collapsed. We would have had a second Great Depression.
Congress has made it clear that it wants mark-to-market suspended or abolished, but the SEC and the Treasury Department still refuse to meaningfully modify it. This is the one big piece of business left undone in ending the credit crisis.
The final factor in this perfect storm was short-sellers. They quickly saw how mark-to-market made seemingly impregnable companies vulnerable to destruction. They picked their targets and relentlessly sold financial stocks short. The SEC helped them out. In the summer of 2007 the commission abolished the uptick rule, which held that a stock couldn't be shorted unless it had gone up in price. It's no surprise to anyone but the SEC that market volatility exploded after the uptick rule ceased. There were no speed bumps left when shorts went after a stock.
Compounding this lunacy was the SEC's inexplicable failure to enforce the rule against "naked" short-selling. Before an investor can short a stock, he is supposed to borrow the shares and pay a broker or stockholder a fee. What sellers soon realized was that the SEC was turning a blind eye to naked short-selling, thus adding even more pressures to beleaguered bank equities.
As the crisis progressed, Treasury errors didn't help, particularly its policy of virtually wiping out the value of Bear Stearns' common stock. With that precedent set, shareholders knew that at the merest whiff of a bad rumor they'd better bail out of a bank or insurance company, or their money could be obliterated. That's why Fannie's and Freddie's stocks collapsed so quickly, not to mention those of Lehman Brothers, AIG and Wachovia.
Letting Lehman Brothers fail was also a blunder. The fallout vastly exceeded what would have come down if Bear Stearns had filed for bankruptcy. Had the Treasury not announced in mid- September that it would seek a $700 billion bailout facility, Morgan Stanley and Goldman Sachs would have been destroyed as well.
Blame the Victim
Not surprisingly, despite government's big, basic blunders in this debacle, politicos and much of the media are blaming "excessive deregulation." "A free-market failure," they call it.
We've been here before. The experiences of the two big economic disasters of the 20th century--the Great Depression in the 1930s and the great inflation of the 1970s--dramatically demonstrate how government mistakes can lead to economic stagnation or impoverishment and geopolitical disaster. Both of these economic horrors were blamed on greedy corporations and "economic royalists."
The Depression was actually triggered by the Smoot-Hawley Tariff of 1929--30, which imposed massive taxes on countless imports. Other countries retaliated in kind. The global trading system collapsed. International capital flows dried up. The legislative history of Smoot-Hawley is instructive. When it first surfaced in Congress during the fall of 1929, the stock market cratered. When near the end of 1929 it appeared that Smoot-Hawley was being sidetracked, stocks rallied, ending the year almost where they had begun. But then in early 1930 Smoot-Hawley resurfaced, and stocks resumed their slide, which continued after Smoot-Hawley was signed into law that June. A devastating global contraction ensued.
Compounding that error was the U.S.' giant tax increase in 1932. President Herbert Hoover thought a balanced budget would restore confidence. The top income tax rate was raised from 25% to 63%. Hoover even legislated an excise tax on checks--you had to pay Uncle Sam a fee every time you wrote a check. Not surprisingly, strapped consumers withdrew massive amounts of cash from banks in order to conduct their business, which put even more stress on troubled banks. This check tax was one of the factors leading to the bank closures of 1933. The huge tax increase deepened the U.S. economic slump.
If not for the Depression, Hitler would never have come to power--the Nazis had carried only 2% of the vote in 1928.
The 1970s were a decade of stagnation. The U.S. cut the dollar loose from gold, and other central banks gleefully followed suit. The results were three massive bouts of inflation, each more severe than the one before. The U.S. turned inward. Communism seemed ascendant. Nicaragua fell to a pro-Soviet dictatorship, and its neighbors looked likely to follow. Islamic fanatics seized power in Iran.
By the time Ronald Reagan took office, our military was in a shambles, with the U.S. seen as fatally weak. Our economy was in dreadful shape, with short-term interest rates reaching nearly 21%. But Reagan pursued the right policies. The American economy came booming back, and the U.S. won the Cold War, signaled by the fall of the Berlin Wall.
Okay, now that we are finally effectively dealing with the crisis, what should be done going forward?
A formal strong-dollar policy is essential. Economists gag at the thought, but the best barometer of monetary disturbances is gold. The Fed should tie the dollar to a gold price range of, say, $500 to $550. Though the dollar is stronger today, markets rightly fear that monetary blunders will happen again.
Which brings us to the Fed's enormous new powers, not to mention its current ones. Our central bank is now the U.S.' de facto commercial bank and our commercial paper market. It is bailing out private firms. The necessary change here is simple: After the crisis, the Fed must undergo a dramatic downsizing and be given a focused mission. Otherwise, it'll be a dinosaur-size beast that will severely hurt our country. The Fed is politically unaccountable. Yes, its chairman makes periodic appearances before Congress, but the Fed is not dependent on congressional appropriations. It literally prints its own budget. It pays for its operations out of the interest it receives on all the securities it holds and then remits the rest to Uncle Sam. Talk about the ATM that keeps on giving. In a democracy this is an intolerable situation for an agency that now has such enormous power over the American economy.
The big change--the Federal Reserve should have only two missions. They are: keeping the dollar as good as gold and dealing with financial panics. If it does the dollar part right, a panic should be a once-in-a-century occurrence.
Years ago Congress mandated that the Fed do its part to keep unemployment low and the economy growing. But it is truly preposterous to think this bureaucracy can direct a $13 trillion economy. Look at how impotent the Fed has been in resolving the financial troubles of the past 14 months.
Regulating banks? Clearing checks for banks (which the Fed still does)? Leave those tasks to other agencies.
The dollar must be a fixed measure of value. Changing its value is disruptive, similar to repeatedly changing the number of minutes in an hour or inches in a foot. Since the dollar was cut off from gold nearly 40 years ago, the U.S. and the world have had repeated monetary disruptions. Thanks to the ingenuity of free markets we've still achieved enormous progress. But the pernicious idea that manipulating money is a sound economic tool has repeatedly wrought havoc: the great inflation of the 1970s; the stock market crash of 1987 (which was triggered when the U.S. threatened to let the dollar go into a free fall); the 1994 Mexican peso crisis; the 1997 Asian "contagion," which gratuitously battered the entire Pacific Rim; and the 1998 Russian financial collapse.
Cutting tax rates is also a necessity. Political cultures have a hard time understanding that taxes don't just raise revenue, they are also a price and a burden. The tax you pay on income is the price you pay for working, just as the tax on capital gains is the price you pay for taking risks that work out and the tax on profits is the price you pay for success. If you make it more worthwhile for people to work productively and take risks, they will do so. Rebates are useless--they don't change incentives the way lower tax rates do. Ideally, we should enact a simple flat tax. Twenty-five countries have adopted some form of a flat tax, all successfully.
Economic growth will help prevent another financial time bomb--credit default swaps, a form of debt insurance--from exploding. The nominal amount peaked at $62 trillion and is now down to $55 trillion. Renewed prosperity will enable big companies to service their debts, thus nullifying the need to ever collect on the insurance. Most of these swaps will expire within five years.
Sensible, not punitive, regulations in the financial sector are needed, such as standardization of new financial products so that there is more transparency.
Fannie and Freddie should be broken up into a number of new, recapitalized companies that have no ties to Uncle Sam.
If we have the kind of policies that marked the 1980s and not the kind that marked the 1930s and 1970s, we will be in for a dazzling era of innovation and economic advances. Free-market capitalism will save us--if we let it.
Left to its own devices, the credit crisis, which began in August 2007, would have crushed economies as severely as did the Great Depression.
Belatedly, but thankfully, governments recognized that the only way to get credit flowing again was for them to make quick and direct massive infusions of new equity into beleaguered banks, as well as commit to other emergency measures hitherto unimaginable.
If sensible rescue efforts continue--and they will--the immediate crisis will quickly pass. Shell-shocked businesses and consumers won't recover rapidly from the trauma of recent months, especially as we now cope with recession. But the downturn shouldn't be prolonged: The economy here and those overseas should start to pick up no later than next spring.
That soon? Despite the crisis, the global economy still retains enormous strengths. Between the early 1980s and 2007 we lived in an economic Golden Age. Never before have so many people advanced so far economically in so short a period of time as they have during the last 25 years. Until the credit crisis, 70 million people a year were joining the middle class. The U.S. kicked off this long boom with the economic reforms of Ronald Reagan, particularly his enormous income tax cuts. We burst from the economic stagnation of the 1970s into a dynamic, innovative, high-tech-oriented economy. Even in recent years the much-maligned U.S. did well. Between year-end 2002 and year-end 2007 U.S. growth exceeded the entire size of China's economy. Obviously China's growth rates were higher, but China was coming off a much smaller base.
The world is flush with cash. It's frozen because of fear, but the cash is there. Productivity gains are burgeoning.
So, will this global boom resume next year, slowly at first and then with increasing momentum? It should. Whether that happens, however, depends on the next, highly dangerous phase: the political aftermath.
Will we and other countries pursue policies that hinder growth and retard or abort a full-blown recovery, e.g., regulations that stifle innovation and taxes that harm the creation and deployment of capital? Washington politicians are asking: If the federal government can bail out banks, why not other battered businesses? Congress recently voted for $25 billion in loan guarantees aimed at helping Detroit automakers. (This money is to be used not only to aid Detroit but also to prevent another flare-up of the credit crisis. If the Big Three defaulted on their debts, holders of credit default swaps--which in recent years have grown like toxic weeds--would demand payment from those who wrote the insurance on the automakers' bonds. This would create another wave of losses for financial institutions.)
Some liberal political activists are advocating using Washington's new powers to pursue other agendas, such as forcing tighter emissions curbs or mandating costly health insurance coverage. New attempts to restrict corporate pay, at least in some sectors, is a given--overlooking the unintended side effects of Bill Clinton's attempt to limit CEO pay packages back in 1993. (The deductibility of CEOs' salaries was capped, which led companies to use stock options as never before.) Protectionists are renewing calls for trade restrictions in the name of consumer safety and promoting "better" labor and environmental standards. Politically resurgent labor unions and other activists will push for rules on who sits on corporate boards to "better represent consumers and investors." They want an implicit veto power over the policies of publicly held companies. They're also ready to remove barriers, such as the secret ballot, in order to coerce workers into joining unions.
The financial sector will certainly face new rules and regulations. Will these be sensible, such as rationalizing our myriad, overlapping financial regulatory structures and pushing for the creation of exchanges and clearinghouses for exotic instruments, such as credit default swaps, so we have transparency and standardization? Or will they be punitive and costly like the Sarbanes-Oxley Act? Washington's new powers over banks may make our capital markets more hostile to entrepreneurs--savings bonds won't give you high returns, but they will protect you from political fallout. Or, as happened with Fannie Mae and Freddie Mac, will they make banks do things for political not economic reasons?
A chilling result of the crisis will be furthering the deadly process of criminalizing business failures. In the old days when an enterprise failed, the proprietors often ended up in debtors' prison. One of the significant advances of civilization and economic progress was the idea of limited liability, which took hold in the 19th century: Investors would be liable only for the money they actually put into a corporation; their other assets would be safe. If an enterprise failed, they lost only what they had invested. Limited liability thereby set off a positive explosion of risk taking. Our standard of living today would be where it was in the 1850s were it not for the wide use of limited liability.
But in recent years, particularly after the Enron/WorldCom corporate scandals, federal and local prosecutors began actively pursuing evidence of fraud whenever a big business went bust. Yes, there has been corporate wrongdoing, and miscreants have been tried and jailed. But many noncriminal individuals have been pursued.
One notorious case was the IRS' attempt to prosecute KPMG and a number of its partners and employees for alleged tax fraud. The shelters KPMG sold in the 1990s were not illegal. The IRS still determined, however, that they weren't valid. That kind of tax dispute would normally be settled in civil court. Instead, prosecutors threatened KPMG with annihilation: Settle on our terms or we will hit you with an enterprise-killing indictment. Arthur Andersen had recently been destroyed by such an indictment, even though the courts subsequently threw the charges out. The feds even pressured KPMG not to pay the legal bills of the targeted individuals--which would have forced these people to settle, as they couldn't afford the massive legal costs of defending themselves. Thankfully, a courageous federal judge stopped this abuse.
But the itch to indict remains. No sooner had Bear Stearns, Lehman Brothers and AIG gone bust than criminal investigators swarmed in. They will find evidence of "fraud"--why didn't you more aggressively mark down the value of suspect paper even if there wasn't a market for it? Why the expressions of confidence in the soundness of your businesses when the rumors of trouble were surfacing? Lost in all this will be the fact that Lehman and AIG didn't know they were in mortal peril until almost the very end. There will be indictments. The chilling lesson: Unsuccessful risk taking or failing in business can send you to prison.
So what should our responses be now? To answer that, we must first understand the crisis' causes.
What started in August 2007 was not the failure of free markets but the outcome of bad government actions. Greed and recklessness always run rampant during bubbles, and the mania that engulfed housing and much of the financial sector was no exception. The behavior of mortgage bankers and of Wall Street packagers of subprime mortgages, as well as the excesses and misuses of exotic instruments, will be grist for investigators and writers for decades to come. But all this came about because of government errors--regulatory and monetary.
In 2004 the Federal Reserve made a fateful miscalculation. It thought the U.S. economy was much weaker than it was and therefore pumped out excessive liquidity and kept interest rates artificially low. When too much money is printed, the first area to feel it is commodities. Thus the Fed begat a global commodities boom. The price of oil, copper, steel, international shipping--even mud--shot up. The price of gold roared above its average of the previous 12 years. For nearly 4 years the dollar sank against the euro, yen and pound. Domestically the already booming housing market went on steroids. Housing was experiencing above-average price rises because of a favorable change in the tax law in 1998 that virtually eliminated capital gains taxes on the sale of most primary residences. Now with money easy, a bubble mentality took hold. The reasoning was that housing prices always go up; therefore, lending standards could be safely lowered. If a dodgy borrower defaulted, it didn't matter--the value of the house would always be higher. Wall Street's appetite for these fee-generating packages of subprime mortgages became gluttonous. Rating agencies also drank the Kool-Aid and gave AAA ratings to this stuff, which, thanks to securitization, was spread all around the world. The Fed and other bank regulators stood by as the bubble ballooned.
Why didn't the Treasury Department--behind the scenes--tell the Fed to strengthen the enfeebled greenback? Because the Bush Administration likes a weak dollar, feeling that it will improve our trade balance by artificially making our exports cheaper. Not since Jimmy Carter has the U.S. had such a weak-dollar Administration. This mania would never have reached the proportions it did had the Fed and Treasury had a strong-dollar policy.
The housing bubble burst in 2007, and banks and investors began to be fearful--who had this junk, and how much did they hold? The credit system showed the first signs of panic. The Federal Reserve responded with another round of easy money, thus creating yet another commodities bubble. Finally, this summer, the Fed ceased spraying money like a fire hose. Dollars that had been lent out through the Fed's various borrowing facilities were then soaked up in its open-market operations. That's why, when the panic reached a peak this fall, gold prices didn't go through the roof as everyone sought safety. In fact, gold never reached the level it had in July.
Maybe, just maybe, Ben Bernanke has learned a lesson about the need for stable money that his predecessor, Alan Greenspan, never did.
Another factor fanning the housing bubble was Fannie Mae and Freddie Mac. They were smarting from studies (including a couple from the Federal Reserve) concluding that these two "government-sponsored enterprises" had little or no positive impact on helping the housing market. And they were also reeling politically from egregious accounting scandals. The companies, therefore, decided they could justify their existence by becoming champions of "affordable housing." They guaranteed $1 trillion of less-than-prime mortgages and kept more than $100 billion of this suspect paper on their balance sheets. Mortgage banks and Wall Street packagers of securities knew that Fannie and Freddie were there to buy whatever questionable stuff they offered up.
Over the years efforts by a handful of senators and representatives to rein in these two monsters were easily brushed off, as were those of the Fed to have them shrink their mammoth sizes. (Of course, now that the bubble has burst, what was once dubbed as promoting affordable housing is being portrayed as "predatory lending.")
Even with Fannie and Freddie inflating the bubble and the Fed and the rest of the Bush Administration weakening the dollar, the crisis never would have become so unprecedentedly destructive but for a seemingly arcane accounting principle called mark-to-market, or fair value, accounting. The idea seems harmless: Financial institutions should adjust their balance sheets and their capital accounts when the market value of the financial assets they hold goes up or down. That works when you have very liquid securities, such as Treasurys or the common stock of IBM or GE. But when the credit crisis hit there was no market for subprime securities. Yet regulators and lawsuit-fearful auditors pressed banks and other financial firms to relentlessly knock down the book value of this subprime paper, even in cases where these obligations were being serviced in the payment of principal and interest. Mark-to-market became the weapon of mass destruction.
When banks wrote down the value of these assets they had to get new capital. The need for new capital was a signal to ratings agencies that these outfits might be in need of a credit-rating reduction. This forced financial firms to increase collateral for credit default swaps--which meant more calls for new capital.
Result: Investment banks that still had positive cash flows found themselves in a death spiral. Of the $600-plus billion that financial institutions have written off, almost all of it has been book writedowns, not actual cash losses. This accounting madness sank Fannie and Freddie this summer when the government effectively took them over and provided them with a $200 billion loan facility. The two entities are still cash positive and haven't drawn down a dime of this new line of credit.
Rigid mark-to-market accounting is similar to a highway that has a speed limit and a speed minimum. When snow appears on the road, bad road conditions cause drivers to go slowly. Under a mark-to-market concept, police would be ticketing these slow drivers for going below the minimum speed.
If this accounting asininity had been in effect during the banking trouble in the early 1990s, almost every major commercial bank in the U.S. would have collapsed. We would have had a second Great Depression.
Congress has made it clear that it wants mark-to-market suspended or abolished, but the SEC and the Treasury Department still refuse to meaningfully modify it. This is the one big piece of business left undone in ending the credit crisis.
The final factor in this perfect storm was short-sellers. They quickly saw how mark-to-market made seemingly impregnable companies vulnerable to destruction. They picked their targets and relentlessly sold financial stocks short. The SEC helped them out. In the summer of 2007 the commission abolished the uptick rule, which held that a stock couldn't be shorted unless it had gone up in price. It's no surprise to anyone but the SEC that market volatility exploded after the uptick rule ceased. There were no speed bumps left when shorts went after a stock.
Compounding this lunacy was the SEC's inexplicable failure to enforce the rule against "naked" short-selling. Before an investor can short a stock, he is supposed to borrow the shares and pay a broker or stockholder a fee. What sellers soon realized was that the SEC was turning a blind eye to naked short-selling, thus adding even more pressures to beleaguered bank equities.
As the crisis progressed, Treasury errors didn't help, particularly its policy of virtually wiping out the value of Bear Stearns' common stock. With that precedent set, shareholders knew that at the merest whiff of a bad rumor they'd better bail out of a bank or insurance company, or their money could be obliterated. That's why Fannie's and Freddie's stocks collapsed so quickly, not to mention those of Lehman Brothers, AIG and Wachovia.
Letting Lehman Brothers fail was also a blunder. The fallout vastly exceeded what would have come down if Bear Stearns had filed for bankruptcy. Had the Treasury not announced in mid- September that it would seek a $700 billion bailout facility, Morgan Stanley and Goldman Sachs would have been destroyed as well.
Blame the Victim
Not surprisingly, despite government's big, basic blunders in this debacle, politicos and much of the media are blaming "excessive deregulation." "A free-market failure," they call it.
We've been here before. The experiences of the two big economic disasters of the 20th century--the Great Depression in the 1930s and the great inflation of the 1970s--dramatically demonstrate how government mistakes can lead to economic stagnation or impoverishment and geopolitical disaster. Both of these economic horrors were blamed on greedy corporations and "economic royalists."
The Depression was actually triggered by the Smoot-Hawley Tariff of 1929--30, which imposed massive taxes on countless imports. Other countries retaliated in kind. The global trading system collapsed. International capital flows dried up. The legislative history of Smoot-Hawley is instructive. When it first surfaced in Congress during the fall of 1929, the stock market cratered. When near the end of 1929 it appeared that Smoot-Hawley was being sidetracked, stocks rallied, ending the year almost where they had begun. But then in early 1930 Smoot-Hawley resurfaced, and stocks resumed their slide, which continued after Smoot-Hawley was signed into law that June. A devastating global contraction ensued.
Compounding that error was the U.S.' giant tax increase in 1932. President Herbert Hoover thought a balanced budget would restore confidence. The top income tax rate was raised from 25% to 63%. Hoover even legislated an excise tax on checks--you had to pay Uncle Sam a fee every time you wrote a check. Not surprisingly, strapped consumers withdrew massive amounts of cash from banks in order to conduct their business, which put even more stress on troubled banks. This check tax was one of the factors leading to the bank closures of 1933. The huge tax increase deepened the U.S. economic slump.
If not for the Depression, Hitler would never have come to power--the Nazis had carried only 2% of the vote in 1928.
The 1970s were a decade of stagnation. The U.S. cut the dollar loose from gold, and other central banks gleefully followed suit. The results were three massive bouts of inflation, each more severe than the one before. The U.S. turned inward. Communism seemed ascendant. Nicaragua fell to a pro-Soviet dictatorship, and its neighbors looked likely to follow. Islamic fanatics seized power in Iran.
By the time Ronald Reagan took office, our military was in a shambles, with the U.S. seen as fatally weak. Our economy was in dreadful shape, with short-term interest rates reaching nearly 21%. But Reagan pursued the right policies. The American economy came booming back, and the U.S. won the Cold War, signaled by the fall of the Berlin Wall.
Okay, now that we are finally effectively dealing with the crisis, what should be done going forward?
A formal strong-dollar policy is essential. Economists gag at the thought, but the best barometer of monetary disturbances is gold. The Fed should tie the dollar to a gold price range of, say, $500 to $550. Though the dollar is stronger today, markets rightly fear that monetary blunders will happen again.
Which brings us to the Fed's enormous new powers, not to mention its current ones. Our central bank is now the U.S.' de facto commercial bank and our commercial paper market. It is bailing out private firms. The necessary change here is simple: After the crisis, the Fed must undergo a dramatic downsizing and be given a focused mission. Otherwise, it'll be a dinosaur-size beast that will severely hurt our country. The Fed is politically unaccountable. Yes, its chairman makes periodic appearances before Congress, but the Fed is not dependent on congressional appropriations. It literally prints its own budget. It pays for its operations out of the interest it receives on all the securities it holds and then remits the rest to Uncle Sam. Talk about the ATM that keeps on giving. In a democracy this is an intolerable situation for an agency that now has such enormous power over the American economy.
The big change--the Federal Reserve should have only two missions. They are: keeping the dollar as good as gold and dealing with financial panics. If it does the dollar part right, a panic should be a once-in-a-century occurrence.
Years ago Congress mandated that the Fed do its part to keep unemployment low and the economy growing. But it is truly preposterous to think this bureaucracy can direct a $13 trillion economy. Look at how impotent the Fed has been in resolving the financial troubles of the past 14 months.
Regulating banks? Clearing checks for banks (which the Fed still does)? Leave those tasks to other agencies.
The dollar must be a fixed measure of value. Changing its value is disruptive, similar to repeatedly changing the number of minutes in an hour or inches in a foot. Since the dollar was cut off from gold nearly 40 years ago, the U.S. and the world have had repeated monetary disruptions. Thanks to the ingenuity of free markets we've still achieved enormous progress. But the pernicious idea that manipulating money is a sound economic tool has repeatedly wrought havoc: the great inflation of the 1970s; the stock market crash of 1987 (which was triggered when the U.S. threatened to let the dollar go into a free fall); the 1994 Mexican peso crisis; the 1997 Asian "contagion," which gratuitously battered the entire Pacific Rim; and the 1998 Russian financial collapse.
Cutting tax rates is also a necessity. Political cultures have a hard time understanding that taxes don't just raise revenue, they are also a price and a burden. The tax you pay on income is the price you pay for working, just as the tax on capital gains is the price you pay for taking risks that work out and the tax on profits is the price you pay for success. If you make it more worthwhile for people to work productively and take risks, they will do so. Rebates are useless--they don't change incentives the way lower tax rates do. Ideally, we should enact a simple flat tax. Twenty-five countries have adopted some form of a flat tax, all successfully.
Economic growth will help prevent another financial time bomb--credit default swaps, a form of debt insurance--from exploding. The nominal amount peaked at $62 trillion and is now down to $55 trillion. Renewed prosperity will enable big companies to service their debts, thus nullifying the need to ever collect on the insurance. Most of these swaps will expire within five years.
Sensible, not punitive, regulations in the financial sector are needed, such as standardization of new financial products so that there is more transparency.
Fannie and Freddie should be broken up into a number of new, recapitalized companies that have no ties to Uncle Sam.
If we have the kind of policies that marked the 1980s and not the kind that marked the 1930s and 1970s, we will be in for a dazzling era of innovation and economic advances. Free-market capitalism will save us--if we let it.
Hero: Staff Sergeant Carlo A. Alcazar
Sgt. 1st Class Drew C. Kimmey, Capt. Stephen P. Ward and Staff Sgt. Carlo A. Alcazar, members of Civil Affairs Team 745, were recently recognized for their performance during an Afghanistan mission last November. The three soldiers were recognized for their efforts in rescuing a Special Forces team leader, who was also the ground forces commander that day.
CA Team 745 was stationed at Firebase Cobra in Oruzgan, Afghanistan, with special operations detachments from the 3rd Special Forces Group, members of the Afghan National Army and the Afghan National Police. On Nov. 2, 2007, the teams and their Afghan counterparts left the firebase to visit the village of Sarsina to conduct medical capabilities mission as well as a humanitarian aid drop. Once they arrived at the village, they discovered it had been evacuated and that Taliban fighters were entrenched into several fighting positions in an attempt to ambush forces in the area.
Alcazar reported only three families came in for medical treatment. The families told the soldiers the Taliban made the other people leave the village, but that having nowhere to go. they stayed. “What was alarming,” Ward said later, “was the buildings had locks and barricaded doors, which was a clear indication that the village wasn’t abandoned, but had been turned into a defendable position.”
All three quickly figured it was only a matter of time before the firefight would begin.
The teams were quickly engaged by 300 Taliban fighters. According to Army documents, after an hour of fighting, two vehicles were pulled to the rear of the fight after being disabled. This left the ground forces commander to the front of the coalition lines and in jeopardy of being overrun. At this point, Ward, the team leader for 745, radioed to the ground forces commander, who was pinned down in a vulnerable building, that his was on its way. Ward later said he and Alcazar went because they were the closest truck and the others were busy providing cover. Unfortunately, the team’s vehicle crashed into an enemy fighting position and became immobile, knocking Ward and Alcazar momentarily unconscious.
After they regained consciousness, Alcazar took to reloading ammunition belts, enabling Kimmey, the gunner, to continue to engage enemy forces. Ward exited the vehicle and directed his team to dismount and move to cover. Kimmey remained in the turret, providing cover for the team and allowing them to reach the ground forces commander. He stayed even though he knew the enemy was setting up mortar positions to destroy the truck he was firing from.
Kimmey was able to keep the Taliban from overrunning the soldiers with the .50-caliber gun. In the process, he was drawing a majority of the enemy fire. Ward reported the enemy was about 50 to 100 meters away at this point.
Team 745 moved to the ground commander’s position and helped in the recovery of the commander and the casualties. All of this was done, while under “continual, accurate and effective” enemy fire.
Since the team’s 745’s vehicle was immobile, it was stripped of all sensitive equipment, and its gun was dismantled to prevent the enemy from gaining off of the team’s loss. Once team 745 sterilized their truck, they had no choice but to run beside the Special Forces vehicle, using it as cover, until they reached safety, because there was no room for them on the truck. All three of them ran alongside the truck until they reached a checkpoint and mounted up into another vehicle for the ride back to firebase Cobra.
During the civil affairs award ceremony honoring all three for their heroic acts, Maj. Gen. John F. Mulholland, said, “The words can’t do justice, nor can the medal on your chest convey what they went up against.”
Thursday, October 23, 2008
The Obama Enigma- Victor Davis Hanson
Lame-duck Republican President Bush's dismal poll ratings have descended to those of Harry Truman's when he left office. The Democratic majority in Congress will probably widen after the election. Republican nominee John McCain has not run a dynamic campaign. Gen. Colin Powell, George Bush's former secretary of state, has now enthusiastically endorsed Barack Obama.
The country is in two unpopular wars -- amid the worst financial panic of the last 80 years. Not since prophet of change and newcomer Jimmy Carter ran against Gerald Ford (post Watergate and the lost Vietnam war) have voters been so eager for a shake-up.
Why then is the charismatic Barack Obama not quite yet a shoo-in?
Easy. Voters apparently still don't know who Obama is, or what he wants to do -- and so are still not altogether sure that Obama is the proper antidote to George Bush. After more than a year of campaigning, he still remains an enigma.
Obama promised to be the post-racial candidate who would bring us together. But when asked in March 2004 whether he attended regularly Rev. Jeremiah Wright's Trinity United Church of Christ, Obama boasted, "Yep. Every week. 11 o'clock service."
The healer Obama further characterized the racist Wright as "certainly someone who I have an enormous amount of respect for." And Obama described the even more venomous father Michael Pfleger as "a dear friend, and somebody I interact with closely."
Obama can dismiss his past associations with Bill Ayers as perfunctory and now irrelevant. But why then did an Obama campaign spokesman say Obama hadn't e-mailed with or spoken by phone to Ayers since January 2005 , suggesting more than three years of communications -- in a post-9/11 climate -- after Ayers said publicly he had not done enough bombing?
Obama's campaign shrugged when legal doubts were raised about the sloppy voter registration practices of ACORN -- an organization that Obama himself has both helped and praised.
Yet Obama once was a stickler for proper voter documents. In 1996, he had all of his Democratic rivals removed from the ballot in an Illinois state primary election on the basis of sloppy voter petitions.
Many of Obama's surrogates, from congressional leaders like Rep. John Lewis to his running mate, Joe Biden, have suggested that the McCain and Palin candidacies have heightened racial tensions. Do such preemptory warnings mean that one cannot worry about Obama's 20-year relationship with Rev. Wright or long association with Father Pfleger?
It's also unclear exactly what Obama's message of "hope" and "change" means. The hope part turned a little weird when Obama, in prophetic fashion, proclaimed, "We are the ones we've been waiting for," and later put up Greek-temple backdrops for his speech at the Democratic convention.
If we didn't get that supernatural message, Obama also promised of his election that it would be the "moment when the rise of the oceans began to slow and our planet began to heal."
And change? Obama himself has changed positions on FISA, NAFTA, campaign public financing, town-hall meetings with McCain, offshore drilling, nuclear and coal power, capital punishment and gun control, his characterization of Iran, the surge in Iraq, and the future of Jerusalem. So change from what to what?
Under Sen. Obama's tax plan, nearly half of all income earners wouldn't pay federal income taxes. He also offers billions in cash payments to millions of those people. And he promises to pay for that loss in revenue by upping taxes on those in the highest income brackets, who already pay the majority of existing income taxes -- and who could also be subject to proposed higher payroll, estate and capital gains taxes.
Is that a tax-cut policy or more a redistribution of wealth in search of forced equality -- what Obama himself apparently calls to "spread the wealth around" or what Biden once suggested was "patriotic"?
A Martian who reviewed Obama's past elections in Illinois, the various associations he once cultivated, his brief voting record in the Senate, and the positions he originally outlined when he announced his presidential campaign might objectively conclude that America could elect either the most far left or the most unknown presidential candidate in its history.
I just hope that it is still not racist or McCarthy-like -- or blasphemous -- simply to suggest that.
Victor Davis Hanson is a classicist and historian at the Hoover Institution, Stanford University, and author, most recently, of "A War Like No Other: How the Athenians and Spartans Fought the Peloponnesian War." You can reach him by e-mailing author@victorhanson.com.
Hero: Staff Sergeant Michael Gainey
Without Staff Sergeant Michael Gainey of the United States Army in the gunner’s turret, October 22, 2007 could have ended in tragedy.
As the three vehicle patrol Gainey was in went down Route Gator in Baghdad, enemy fire transformed a normal mission into a life or death struggle for him, the fellow troops in his patrol, and several dismounted soldiers caught right in the jaws of the attack. From Gainey’s vantage point behind the imposing M240B machine gun, he was able to coordinate the counterattack with precisely aimed shots and suppressive fire.
The enemies’ attention locked onto his turret, firing a salvo at him, fragmenting and wounding him in the neck and hand. Undeterred, he refused medical treatment, preferring to heal his wounds by repulsing the ambush with automatic weapons fire from his position.
The vehicle commander knowing the American troops in the distance were doomed without his assistance, ordered the driver to advance to their position, requiring Gainey to call out upcoming obstacles from his elevated perch and maintain a hail of machine gun fire at the insurgent positions. From his exposed mount he refused to yield and fired more than 150 rounds – killing or repelling the last of the failed ambushers.
Because of Gainey’s steadfastness under enemy fire, his precisely aimed fire, and effective coordination with the vehicle’s crew, American lives were saved that day. His heroism earned him the Bronze Star with Valor.
Home Front Hero: The American Soldier Foundation
The American Soldier Foundation was created to assist soldiers on extended active duty and their dependents, and the dependents of those lost in the line of duty. Military life often places a difficult burden on families, both financially and emotionally. We believe that the lives of the men and women keeping our country safe should not be any harder than they have to be. It is in that spirit that we offer our support. They fight for us - let's fight for them.
The Foundation can provide grants or interest-free loans for:
Food, rent or utilities
Funeral expenses
Family/marriage counseling
Medical expenses
Financial planning
Personal needs when pay is delayed or stolen
Education planning and scholarships
Fines or legal expenses
Business planning
Liquidate or consolidate debt
Home purchase or improvements
Purchase, rent or lease vehicle
Debt or credit card bills
Etc.
"Who said it could not be done? And tell me what great victories does he have to his credit which qualifies him to judge what can and can't be accomplished." --Napoleon Hill
"It is common sense to take a method and try it. If it fails, admit it frankly and try another. But above all, try something." -- Franklin D. Roosevelt
"It is common sense to take a method and try it. If it fails, admit it frankly and try another. But above all, try something." -- Franklin D. Roosevelt
Wednesday, October 22, 2008
Boasting Weakness - Investors Business Daily
The latest in the endless series of gaffes from Obama running mate Joseph Biden is his warning that our enemies would test a President Obama early on. We need a president they would fear to test.
Taliban kill 15 troops in Swat ambush
The Taliban conducted a deadly ambush on a paramilitary convoy in the district of Swat in Pakistan's violent Northwest Frontier Province. Fifteen troops were killed and six are still missing after a roadside bomb attack and battle in the Kabal region, police told Reuters.
"After the exchange of fire that lasted for several hours, more than 20 troops went missing but today we found 15 dead bodies at the site," a police officer in Kabal told Reuters. Five Taliban and three civilians were also reported killed in the firefight.
"After the exchange of fire that lasted for several hours, more than 20 troops went missing but today we found 15 dead bodies at the site," a police officer in Kabal told Reuters. Five Taliban and three civilians were also reported killed in the firefight.
The Increasingly Erratic, Super-Gaffetastic Joe Biden
Be afraid. Be very afraid.
By Michelle Malkin
If the prospect of Joe Biden sitting a heartbeat away from the presidency doesn’t give you palpitations, you are not paying attention.
By Michelle Malkin
If the prospect of Joe Biden sitting a heartbeat away from the presidency doesn’t give you palpitations, you are not paying attention.
Home Front Hero: The Aleethia Mission
The Aleethia Mission
The Aleethia Foundation supports recently injured troops in their rehabilitation upon returning home.
Dear Friends and Supporters of The Aleethia Foundation:
We are a small non profit dedicated to helping the newly injured troops. We are just a few people, all volunteers, trying to aid in the initial phase of recovery. We do this by providing dinners and short term recreation outings and small grants.
We have been doing dinners every Friday night since October of 2003. We occasionally take pictures and post them on this site. Most of the dinners are paid for by contributions from individuals and a few from corporations. Some corporations will sponsor a dinner thereby picking up the cost of an entire dinner. The dinners cost from $3,000 to $5,000 per week.
The Capitol Hill Club gives us a substantial cost reduction. Additionally on the nights we are at the Capitol Hill Club, the Harris Ranch donates the steaks. They are outstanding steaks.
Please visit the events portion of this web site to see pictures of the wonderful troops that have been so seriously injured. While most of the troops are combat wounded, some have been injured in other ways. We support all troops that have put on the uniform for this country. How the injury was received in not of concern to us. We appreciate all service. Some of the injuries are from accidents in a combat zone, just not inflicted during a combat operation.
Thank you for visiting The Aleethia Foundation. Your support for the troops is greatly appreciated.
Please pass this on to everyone you know, friends, relatives; everyone can use this mall to support our programs.
While injured troops receive medical care to heal their physical wounds, The Aleethia Foundation honors them with opportunities to enjoy some time away from the hospital environment. Troops say these occasions make them feel truly 'at home'.
Hero: Lance Corporal Justin McLeese
Throughout 2004, U.S. forces in Iraq battled an increasingly lethal enemy. The Marine Corps maintained a large presence and engaged itself in hotspots throughout central Iraq. Numerous acts of heroism emerged from the conflict, such as the actions of Lance Corporal Justin McLeese. During the fall of that year, McLeese distinguished himself on duty and in battle, and earned the Bronze Star for his gallantry.
On September 16, McLeese rode in a convoy traveling to an Iraqi compound, when his vehicle flipped off the road after passing over rough, gravel terrain. Thrown 20 feet from the humvee, McLeese ignored his own pain and tended to those still trapped in the vehicle. After pulling his platoon sergeant from wreckage, McLeese rescued another Marine trapped beneath a large amount of gear. McLeese, with help from his platoon, then lifted the humvee off the ground to save a third Marine stuck under the vehicle and pinned underneath a Kevlar ballistic plate.
High-intensity urban combat engulfed Fallujah in November. McLeese and his fellow Marines cleared numerous buildings in the middle of the city. On November 11, his team entered one of the compounds and killed four enemy combatants. An insurgent, after faking his death, tried to engage the Marines from a nearby room. McLeese recognized the impending attack and eliminated the threat with a shotgun blast. Two days later, McLeese entered another building in Fallujah, where enemy fire struck him. Despite multiple gunshot wounds, McLeese fought until the end, before an IED explosion fatally wounded him.
For his dedication to his comrades and courage under fire, McLeese posthumously received the Bronze Star Medal.
Tuesday, October 21, 2008
Would the Last Honest Reporter Please Turn On the Lights?
By Orson Scott Card
Editor's note: Orson Scott Card is a Democrat and a newspaper columnist, and in this opinion piece he takes on both while lamenting the current state of journalism.
An open letter to the local daily paper — almost every local daily paper in America:
I remember reading All the President's Men and thinking: That's journalism. You do what it takes to get the truth and you lay it before the public, because the public has a right to know.
This housing crisis didn't come out of nowhere. It was not a vague emanation of the evil Bush administration.
It was a direct result of the political decision, back in the late 1990s, to loosen the rules of lending so that home loans would be more accessible to poor people. Fannie Mae and Freddie Mac were authorized to approve risky loans.
Read The Whole Thing
Editor's note: Orson Scott Card is a Democrat and a newspaper columnist, and in this opinion piece he takes on both while lamenting the current state of journalism.
An open letter to the local daily paper — almost every local daily paper in America:
I remember reading All the President's Men and thinking: That's journalism. You do what it takes to get the truth and you lay it before the public, because the public has a right to know.
This housing crisis didn't come out of nowhere. It was not a vague emanation of the evil Bush administration.
It was a direct result of the political decision, back in the late 1990s, to loosen the rules of lending so that home loans would be more accessible to poor people. Fannie Mae and Freddie Mac were authorized to approve risky loans.
Read The Whole Thing
The comprehensive argument against Barack Obama
CLOSING THE DEAL
A Roadmap for Campaign 2008’s Homestretch
By Guy Benson (www.guybensonshow.com) and Mary Katharine Ham (www.weeklystandard.com)
Editor and Contributor, Ed Morrissey
A Roadmap for Campaign 2008’s Homestretch
By Guy Benson (www.guybensonshow.com) and Mary Katharine Ham (www.weeklystandard.com)
Editor and Contributor, Ed Morrissey
A Comedy of Errors
Democrats are exactly two weeks away from taking back the White House and expanding their majorities in both houses of Congress. So what in the heck are they doing? It's like a comedy of errors out there. Joe Biden hands McCain a tailor made argument on foreign policy. Barney Frank goes on the most watched business channel in American and says he's eager to raise taxes. Jack Murtha continues to insult members of his own district in Western Pennsylvania. John Kerry cracks wise about McCain's incontinence.
Credit Markets Continue to Thaw Out
The lending rates between banks in the U.S. and Europe have dropped to the lowest levels in over a month as credit markets continue to improve.
The rate on three-month loans in dollars has slumped 0.23 percentage points to 3.83%. The so-called European Interbank Offered Rate for three-month euro-denominated loans has fallen 0.03 percentage points to 4.968%.
That is the first time the euro rate has dipped below 5.00% since Sept. 18, when it shot higher after U.S. investment bank Lehman Brothers collapsed.
Interbank rates are important because they affect the cost of loans to businesses and individuals. They skyrocketed in recent months as banks worried that other lenders might collapse.
After massive intervention from governments and central banks, that worry is slowly fading.
The rate on three-month loans in dollars has slumped 0.23 percentage points to 3.83%. The so-called European Interbank Offered Rate for three-month euro-denominated loans has fallen 0.03 percentage points to 4.968%.
That is the first time the euro rate has dipped below 5.00% since Sept. 18, when it shot higher after U.S. investment bank Lehman Brothers collapsed.
Interbank rates are important because they affect the cost of loans to businesses and individuals. They skyrocketed in recent months as banks worried that other lenders might collapse.
After massive intervention from governments and central banks, that worry is slowly fading.
JOE D'OH PUTS O IN 'CRISIS' MODE
Joe Biden warned that America's enemies would test Barack Obama with an international crisis within six months if he's elected president - a shocking comment John McCain eagerly pounced on yesterday to claim Obama isn't ready to be commander-in-chief.
Monday, October 20, 2008
U.S. Marine Lt. Col. Richard Hall: Enemy Engagements Decrease for Marines in Afghanistan
Enemy Engagements Decrease for Marines in Afghanistan
By Navy Seaman William Selby
Special to American Forces Press Service
WASHINGTON, Oct. 17, 2008 – As the 2nd Battalion, 7th Marine Regiment continues to enhance security in Afghanistan, Marines there are experiencing decreased enemy engagements, the battalion’s commander said yesterday.
“We’ve killed or captured a lot of the [Taliban’s] leadership,” U.S. Marine Lt. Col. Richard Hall, commander of Task Force 2D Battalion, 7th Marine Regiment, 1st Marine Division, told bloggers during a teleconference.
Other possible reasons Hall cited for fewer engagements include the recent Muslim holiday of Ramadan, the beginning of winter in Afghanistan and the enhanced efforts of the Afghan National Police.
“We’ve now trained over 800 Afghan National Police and have placed them in various districts,” he said.
Most people think that training and mentoring are not critical parts of counterinsurgency operations, when in fact, they are a subset, Hall said.
“The first thing is the force comes in here and establishes themselves and initiates the security piece, then what we had to do is we had to concurrently do the training and mentoring” of the police, he said.
In addition to training, the Marines have initiated several other long- and short-term projects under strategies they call “focused district development” and “in-district reform.”
The Marines have enhanced the Afghan economy, opened mosques, built schools, and are hoping to build a road, although that may not happen soon, Hall said.
“We’re hoping to build a road here, probably not on our watch, but certainly on our replacements’ watch,” Hall said. The 2nd Battalion, 7th Marines will be replaced by the 3rd Battalion, 8th Marine Regiment in the near future.
Hall said that while he is constantly seeing improvement in his districts, there are still several challenges, specifically in recruiting for the Afghan police.
“We really need to recruit from districts in which we are going to replace those [police],” Hall added. “They get a good education, they come back, and there’s an immediate change in the district when they go out there. All our guys that mentor them when they’re back out in their districts have noted the significant improvements that are made.”
As the Marine units prepare to rotate, a top priority is ensuring that the Afghan recruitment is done right.
“I think we got it right now,” said Hall. “The next evolutions [in reform and development of districts] are going to be much more successful, and so it will be the way of the future in emplacing these [police] in the districts, which becomes a foundation for governance at the district level.”
To set the stage for the incoming Marine unit, Hall said his Marines would prepare training on lessons learned.
“We want to give them the proper introduction to the history, teach them the techniques and procedures that will keep them alive,” Hall said. “And we owe that to our brothers.”
In order to be successful, the 3rd Battalion, 8th Marines have to continue to do what the 2nd Battalion, 7th Marines have done - focus on the Afghan people, Hall said.
“We have focused on the enduring effort, those things that will last, those operations which create a foundation for the future, like building schools, educating people, building roads, providing jobs, and aiding commerce,” he said.
(Navy Seaman William Selby works for the New Media branch of the Defense Media Activity)
Hero: Sergeant Jack Bodani
On a mission in Afghanistan, then-Specialist Jack Bodani was in an up-armored humvee column when a massive explosion ripped through his vehicle, engulfing it in a fireball. Simultaneously, automatic weapons fire and well-aimed mortar rounds began hitting dangerously close to the convoy. Bodani, burned on the face and neck from the conflagration, got out of the vehicle and immediately helped another trapped soldier escape.
Safely evacuating the first soldier away from the vehicle, Bodani realized there was another unaccounted for, so he disregarded his own wounds and again ran back to the burning vehicle. At the humvee, the heat of the fire reached a critical temperature and ordinance and rifle ammunition began exploding in every direction. From the east, insurgent attacker became increasingly accurate with their weapons fire. Ignoring all of this, Bodani, and with the aid of another, extracted the dazed soldier.
Still in the height of the ambush and far from safety, Bodani reached for a rifle at the casualty collection point and provided vital security from the brazen enemy fighters. Because of Bodani’s brave acts, the wounded soldiers survived to receive a medevac and receive the urgent care they needed.
Then-Specialist Jack Bodani was awarded the Bronze Star with Valor for his courageous actions.
The Bronze Star
Background: President Roosevelt authorized the Bronze Star Medal by Executive Order 9419 dated Feb. 4, 1944, retroactive to Dec. 7, 1941. This authorization was announced in War Department Bulletin No. 3, dated Feb. 10, 1944. The executive order was amended by President Kennedy, per Executive Order 11046 dated Aug. 24, 1962, to expand the authorization to include those serving with friendly forces.
Criteria: The Bronze Star Medal is awarded to any person who, while serving in any capacity in or with the military of the United States after Dec. 6, 1941, distinguished himself or herself by heroic or meritorious achievement or service, not involving participation in aerial flight, while engaged in an action against an enemy of the United States; while engaged in military operations involving conflict with an opposing foreign force; or while serving with friendly foreign forces engaged in an armed conflict against an opposing armed force in which the United States is not a belligerent party.
Hero Support: Air Compassion For Veterans
The mission and purpose of Air Compassion For Veterans is to ensure that no financially stressed veteran / active duty military person or their family member(s) is denied access to distant specialized medical evaluation, diagnosis, treatment, or rehabilitation for lack of a means of long-distance medical air transportation. ACV is committed to the ongoing healing process of our wounded warriors and will provide transport for activities that aid in the process.
There are various ways to give to Air Compassion For Veterans. Make your gift to help our wounded warriors online. Use your credit card through our secure server by clicking on HERE.
Send a Check by Mail:
Air Compassion For Veterans
4620 Haygood Road, Suite 1
Virginia Beach, VA 23455
Download a Donation Form by clicking on the following link: Donation Form
Give through the Combined Federal Campaign
Give to the ACV Program in the CFC by designating Mercy Medical Airlift which is CFC #11844
US Airways Miles of Hope Program
Help us help veteran patients in need of distant transportation by donating to the US Airways Miles of Hope Program. Click on the US Airways link below and donate to the Air Charity Network.
For more information on giving to Air Compassion For Veterans please contact us at 757-318-9174 ext. 205.
Marcus Aelius Aurelius
"Loss is nothing else but change, and change is Nature's delight."
-- Marcus Aelius Aurelius
-- Marcus Aelius Aurelius
Nietzsche
"Believe me! The secret of reaping the greatest fruitfulness and the greatest enjoyment from life is to live dangerously!"
-- Friedrich Wilhelm Nietzsche
-- Friedrich Wilhelm Nietzsche
The Real Plumbers of Ohio by Paul Krugman
Krugman says the avg. plumber in Ohio only made about $48k in 2007. On a 40 hour week that's just $23 an hour. Can someone please give me that plumbers phone #?
Geez I can't even get my lawn mowed for $23. A plumber here is $80 an hour plus a trip charge of $75 with a minimum of $150.00...but then everything is bigger in Texas, either that or there is just that much more s*** here in Texas!!!!
Geez I can't even get my lawn mowed for $23. A plumber here is $80 an hour plus a trip charge of $75 with a minimum of $150.00...but then everything is bigger in Texas, either that or there is just that much more s*** here in Texas!!!!
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